Europe has long positioned itself as a global leader in climate ambition. From the Green Deal to national net-zero targets, nations across the continent have consistently voiced their intent to transition toward a sustainable, decarbonized economy. But while promising steps have been made, when it comes to industrial decarbonization—an essential component of Europe’s economic and emissions engine—there’s more progress to be made.
Despite record investments in clean energy, changes need to be made in order for Europe to meet its 2030 climate goals. According to BloombergNEF, EU carbon emissions need to fall by around 8% annually to hit targets, yet recent reductions have averaged closer to 2%. Much of the challenge lies in the slow pace of transformation within heavy industries like steel, cement, and chemicals. These sectors account for nearly a quarter of Europe’s greenhouse gas emissions, yet efforts to decarbonize them remain stalled by policy inertia, complex permitting frameworks, and risk-averse investment environments.
It’s time to complement ambition with implementation. Europe must now match its climate vision with bold, coordinated action—because the window to lead is narrowing.
Industrial decarbonization is a competitiveness strategy
Let’s be clear: decarbonizing heavy industry is as much about survival as it is about the climate. Many of Europe’s industrial facilities are aging, relatively small-scale, and no longer cost-competitive on the global stage. For example, the EU’s petrochemical sector has experienced a string of shutdowns due to cost pressures and shifting demand. Competing with bulk producers in India or China on price alone is ineffective; our path forward must be through innovation and added value.
The only way for European industry to thrive is to go green. Sustainability must become a core pillar of industrial strategy, rather than a regulatory burden. This means leveraging our engineering excellence, investing in emerging technologies (e.g. in electrification), and aligning industrial output with the needs of a carbon-conscious global market.
Bridging the investment gap
Clean technology for heavy industries is no longer in its infancy. For instance, energy-and cost efficient electrification solutions capable of replacing fossil fuel combustion in high-temperature processes, once thought infeasible, are now a reality. Technologies like turbine-based, high-temperature electric heating systems are ready to scale. But investment in deployment remains slow.
With global ESG assets now projected to surpass $40 trillion by 2030, the challenge is not a lack of capital but providing evidence for potential investors. In an environment of geopolitical uncertainty and fluctuating carbon prices (EU ETS prices fell from €100 to €65 per ton over the past two years), investors want proof points before committing. However,t many early-stage industrial technologies can’t be de-risked and grown to sufficient scale without that capital.
To break this cycle, we need targeted and agile support for first-of-a-kind projects to accelerate the roll-out of low carbon technologies. Governments must also step in to de-risk markets. Public-private co-investment models, long-term carbon pricing signals, and streamlined permitting processes are essential to get transformative solutions off the ground.
Embracing bold leadership
Europe is rich in ideas and vision, but translating that vision into tangible progress remains a challenge. Too often, promising initiatives get trapped in extensive consultations and efforts to build broad consensus. While these processes are important for long-term success, we must also find ways to enable swifter, more agile decision-making and deployment.
In India, we see large companies, still entrepreneur-led, quickly piloting new technologies, even without robust policy frameworks. It’s not perfect, but it’s progress. Meanwhile, countries like China are deploying solar, wind, and electric vehicles at a pace that rivals the rest of the world combined. In Europe, where, for instance, wind power has maintained a competitive edge through continuous innovation and bringing of better products to the market, we must foster that same boldness. Our policies should not seek to eliminate all risk, but to enable calculated, meaningful leaps.
A blueprint for Europe’s green industrial future
The EU’s Net-Zero Industry Act and the Innovation Fund are steps in the right direction. Countries like Sweden have experimented with collaborative industrial ecosystems, uniting government, corporates, and academia to back pioneering ventures like green steel. But we must go further, and faster.
We need policies that support not only decarbonization but also economic resilience. That means prioritizing industries where Europe can lead; high-tech, high-value, and sustainability-aligned. It means investing in the education and skills ecosystem to match, just as Finland did during its telecom boom.
By mobilizing private sector expertise, aligning academic research with industrial needs, and fast-tracking permitting for breakthrough technologies, Europe can build a model that others want to follow. Not every project will succeed, but that’s part of innovation. The cost of occasional failure when testing and demonstrating the most promising climate technologies is far outweighed by the cost of inaction.
The time is now
Europe’s industrial decarbonization journey is not just about avoiding a climate catastrophe. It’s about seizing the economic opportunity of the century. Clean industry is the growth engine of the future, and the countries that lead this transformation will shape the global economy for decades to come.
We must stop treating decarbonization as a compliance exercise and start treating it as a joint European strategy and source of competitiveness. Europe has a unique opportunity to turn its climate ambitions into industrial renewal. The groundwork has been laid; now it’s time to build on it with purpose and pace.
About the Author
Joonas Rauramo is the CEO of transformational technology and engineering company Coolbrook. He is leading the company’s scaling up and commercial rollout to decarbonise heavy industrial sectors — such as petrochemicals and chemicals, iron and steel, and cement — at global scale through electrification of high-temperature process heating.